Gold prices may rise 20% on Dhanteras, say jewellers

Gold prices may jump further by 20 per cent to touch Rs 32,500 per 10 gram in New Delhi on 'Dhanteras', a day considered auspicious for buying the precious metal, bullion traders said on Friday.

Bullion traders expect that high prices would hit sales in volume terms by up to 30 per cent compared to the last 'Dhanteras' sales, but jewellers like Geetanjali and P P Jewellers are hopeful of rise in sales by about 10 per cent on Dhanteras which is falling on Sunday.

Because of firm prices, gold buying could drop by up to 30 per cent in volume terms on the Dhanteras day, when jewellers normally register the highest gold sales in a year, he said.

Stating that gold as an investment asset has given positive returns in the last few years, SMC Comtrade chairman and managing director D K Aggarwal said, "Gold rate has risen by Rs 4,000-8,000 per ten gram on each Dhanteras day in last five years. Despite high rates, consumers continue to buy."

In the short-term, gold rates are, however, unlikely to decline below Rs 30,000 per 10 gram, he added.

Geetanjai Group chairman and managing director Mehul Chowksi said, "High prices will not be a barrier for Indian consumers. We expect 10 per cent increase in sales in volume terms on Dhanteras."